Cotton prices rise in a ladder-like manner, and a large amount of new cotton has been launched

Cotton prices rise in a ladder-like manner, and a large amount of new cotton has been launched

The cotton reserve rotation for 2015/2016 ended, and 188,945 tons were sold in the following week. Not only was the transaction rate 100%, it also set a single-week record. Understand that this round ended successfully, with a total transaction volume of 264.8 tons. At the same time, new cotton made its debut. However, due to its late launch and the impact of devastating natural disasters such as rain and hail, the purchase price also increased. The price of lint cotton rose, far away from spot, futures and yarn mill expectations. Some purchases There is already an accusatory mood among businesses. Spot prices rose, while futures prices fell internally and externally. On October 9, the national cotton price B index was 15,350 yuan/ton, an increase of 1,067 yuan/ton per ton. Compared with the Zheng cotton futures CF1701 contract, the premium is 170 yuan/ton, which has expanded to 832 yuan/ton in two weeks. Spot hedging and arbitrage are difficult.
Futures. New cotton is coming on the market one after another, and the operation of yarn mills is difficult. The fundamentals do not support a rapid rise. It is also the National Day holiday. After being lured to the market on the 21st, not many people followed the trend. Zheng cotton fell after rising high, and began to gradually pull back on the 27th. Zheng Cotton’s main CF1701 contract closed at 15,180 yuan/ton on September 30, a weekly increase of 235 yuan/ton, with 2,666,360 lots traded, an increase of 493,886 lots, an increase of 22.7%, and 402,684 positions held, a decrease of 15,790 lots, or a decrease of 3.8%. Market fluctuations However, considering the long holiday policy and the uncertainty of the external market, some funds left the market to wait and see, and their positions decreased. As of the close of trading on September 30, the top 20 positions held 161,045 long positions, 190,175 short positions, and 29,130 ​​net short positions. Hedging positions are maintained, with 0 buying positions and 5462 selling positions. As of September 30, there were 841 registered warehouse receipts, a weekly decrease of 31, including 23 2016/17 warehouse receipts, and 203 valid forecasts, a weekly decrease of 8. There are no 2016/17 warehouse receipts. The spot premium is not conducive to the registration of new cotton warehouses. one. Purchase prices rose rapidly during the holidays, and the market is expected to rise sharply at the opening of this Monday. However, the external market is still falling, and internal and external differences have expanded, putting pressure on Zheng Cotton. As the amount of seed cotton on the market increases, prices will also correct. US market: Production is expected to increase, and sales are under pressure. The only option is to exchange price for volume. The December contract closed at 66.95 cents/pound last Friday. There may still be a rebound after the inertial decline in the early part of this week.

　Spot aspect. Due to climate reasons, new cotton is slow. Spinners seized the opportunity after the rotation and actively stocked up. The volume and price rose in the following week, which promoted the increase in spot prices. During the festival, due to continuous rain, seed cotton resources were scarce, and there was a rush to harvest in Xinjiang. The price has risen rapidly, from 6.5 yuan/kg at the beginning of the scale to about 7.5 yuan/kg. The price of lint has also increased, and the cost has reached about 16,000 yuan/ton. The price in the mainland has generally reached about 16,500 yuan/ton. Due to the mainland textile enterprises There are generally some reserve cotton stocks with a price of 15,000 yuan/ton, and they are not active in purchasing high-priced new cotton. As the U.S. market is at a low level, U.S. cotton and Australian cotton prices are relatively low, and recent sales have been good.

New cotton acquisition. Due to continuous rain, the launch of new cotton has been delayed. As of October 8, there were 594,976 bales of Xinjiang cotton in 2016, compared with 966,399 bales in the same period last year, a year-on-year decrease of 38.43%. However, according to public inspection data, the quality of cotton in Xinjiang has improved significantly this year. The fiber length index of 28 mm and above accounted for 92.37%, compared with 38.37% in the same period last year, a year-on-year increase of 142.1%, and a significant improvement; among which the proportion of 29mm grade increased significantly, an increase of 36.35% compared with last year, while the proportion of 27mm grade The decrease was significant, with a decrease of 41.08% compared with last year. The B2 and C2 levels of the micronaire index accounted for 39.46% and 57.75% respectively, compared with 23.32% and 76.46% in the same period last year. The proportion of cotton with high length uniformity and above accounted for 63.90%, compared with 42.21% last year, an increase of 21.69 percentage points; the proportion of Xinjiang cotton with high breaking strength and above accounted for 39.45%, an increase of 4 percentage points compared with the same period last year.

Operation suggestions. There will be a period of periodic price increases. After a large amount of new cotton comes on the market, the price will gradually return. Track the progress of new cotton on the market, and make decisions on long and short positions based on the futures-to-cash basis.